Friday, August 29, 2008

Live Nifty Stocks and Charts

If you want to see the latest Nifty Index for different stocks and other related charts please feel free to visit Nifty Index.
Here you can find all the Index directly from Nifty Site but because of normal traffic you can easily concentrate on the stocks you need and find the related information.

Wednesday, August 20, 2008

Benefits Of Mutual Funds

  • Affordability A mutual fund invests in a portfolio of assets, i.e. bonds, shares, etc. depending upon the investment objective of the scheme. An investor can buy in to a portfolio of equities, which would otherwise be extremely expensive.

  • Diversification It simply means that one must spread their investment across different securities (stocks, bonds, money market instruments, real estate, fixed deposits etc.) and different sectors (auto, textile, information technology etc.). This kind of a diversification may add to the stability of returns.

  • Variety Mutual funds offer a tremendous variety of schemes. It offers different types of schemes to investors with different needs and risk appetites and it offers an opportunity to an investor to invest sums across a variety of schemes, both debt and equity.

  • Professional Management When one person buys in to a mutual fund, they are handing their money to an investment professional that has experience in making investment decisions.

  • Regulations Securities Exchange Board of India (“SEBI”), the mutual funds regulator has clearly defined rules, which govern mutual funds. These rules relate to the formation, administration and management of mutual funds and also prescribe disclosure and accounting requirements. Such a high level of regulation seeks to protect the interest of investors.

  • Liquidity In open-ended mutual funds, one can redeem all or part of their units any time they wish. Some schemes do have a lock-in period where an investor cannot return the units until the completion of such a lock-in period.

  • Convenience An investor can purchase or sell fund units directly from a fund, through a broker or a financial planner. The investor may opt for a Systematic Investment Plan or a Systematic Withdrawal Advantage Plan.

  • Flexibility Mutual Funds offering multiple schemes allow investors to switch easily between various schemes. This flexibility gives the investor a convenient way to change the mix of his portfolio over time.

  • Transparency Open-ended mutual funds disclose their Net Asset Value (“NAV”) daily and the entire portfolio monthly. This level of transparency, where the investor himself sees the underlying assets bought with his money, is unmatched by any other financial instrument. Thus the investor is in the know of the quality of the portfolio and can invest further or redeem depending on the kind of the portfolio that has been constructed by the investment manager.

What is AMFI

With the increase in mutual fund players in India, a need for mutual fund association in India was generated to function as a non-profit organisation. Association of Mutual Funds in India (AMFI) was incorporated on 22nd August 1995.

AMFI is an apex body of all Asset Management Companies (AMC), which has been registered with SEBI. Till date all the AMCs are that have launched mutual fund schemes are its members. It functions under the supervision and guidelines of its Board of Directors.

Association of Mutual Funds India has brought down the Indian Mutual Fund Industry to a professional and healthy market with ethical lines enhancing and maintaining standards. It follows the principle of both protecting and promoting the interests of mutual funds as well as their unit holders.

The objectives of Association of Mutual Funds in India
The Association of Mutual Funds of India works with 30 registered AMCs of the country. It has certain defined objectives, which juxtaposes the guidelines of its Board of Directors. The objectives are as follows:
  • This mutual fund association of India maintains high professional and ethical standards in all areas of operation of the industry.
  • It also recommends and promotes the top class business practices and code of conduct which is followed by members and related people engaged in the activities of mutual fund and asset management. The agencies who are by any means connected or involved in the field of capital markets and financial services also involved in this code of conduct of the association.
  • AMFI interacts with SEBI and works according to SEBI’s guidelines in the mutual fund industry.
  • Association of Mutual Fund of India does represent the Government of India, the Reserve Bank of India and other related bodies on matters relating to the Mutual Fund Industry.
  • It develops a team of well-qualified and trained Agent distributors. It implements a programme of training and certification for all intermediaries and other engaged in the mutual fund industry.
  • AMFI undertakes all India awareness programme for investors in order to promote proper understanding of the concept and working of mutual funds.
  • At last but not the least association of mutual fund of India also disseminate informations on Mutual Fund Industry and undertakes studies and research either directly or in association with other bodies.

Sponsors of Association of Mutual Funds in India (AMFI)

Bank Sponsored

  • SBI Fund Management Ltd.
  • BOB Asset Management Co. Ltd.
  • Canbank Investment Management Services Ltd.
  • UTI Asset Management Company Pvt. Ltd.


  • GIC Asset Management Co. Ltd.
  • Jeevan Bima Sahayog Asset Management Co. Ltd.

Private Sector


  • BenchMark Asset Management Co. Pvt. Ltd.
  • Cholamandalam Asset Management Co. Ltd.
  • Credit Capital Asset Management Co. Ltd.
  • Escorts Asset Management Ltd.
  • JM Financial Mutual Fund
  • Kotak Mahindra Asset Management Co. Ltd.
  • Reliance Capital Asset Management Ltd.
  • Sahara Asset Management Co. Pvt. Ltd
  • Sundaram Asset Management Company Ltd.
  • Tata Asset Management Private Ltd.

Predominantly India Joint Ventures:-

  • Birla Sun Life Asset Management Co. Ltd.
  • DSP Merrill Lynch Fund Managers Limited
  • HDFC Asset Management Company Ltd.

Predominantly Foreign Joint Ventures:-

  • ABN AMRO Asset Management (I) Ltd.
  • Alliance Capital Asset Management (India) Pvt. Ltd.
  • Deutsche Asset Management (India) Pvt. Ltd.
  • Fidelity Fund Management Private Limited
  • Franklin Templeton Asset Mgmt. (India) Pvt. Ltd.
  • HSBC Asset Management (India) Private Ltd.
  • ING Investment Management (India) Pvt. Ltd.
  • Morgan Stanley Investment Management Pvt. Ltd.
  • Principal Asset Management Co. Pvt. Ltd.
  • Prudential ICICI Asset Management Co. Ltd.
  • Standard Chartered Asset Mgmt Co. Pvt. Ltd.

Monday, August 18, 2008

Shadow of a bull

A “false dawn” is an atmospheric anomaly that would have you believe that the sun is about to rise a couple of hours before it is supposed to. Of course, it doesn’t. The phrase is often used as a metaphor for illusion— when you start to feel that a turnaround in fortunes is on the cards when it isn’t. Last fortnight, there was plenty to suggest on Dalal Street and at the Centre—and on Wall Street, too—that the bear hug on the stock markets is about to end, and the bulls could be ready to creep out of the shadows. For starters, the survival of the United Progressive Alliance (UPA) government— at the expense of the Left parties—triggered the hope that a burst of reforms would be squeezed in just before the next general elections.

Is the besr market on its last leg?
Is the besr market on its last leg?
Around the same time, crude oil prices finally paused for breath after hitting highs of close to $150 per barrel; at the time of writing they had settled at $125.30. The first quarter results weren’t an outright disaster (if profit growth is down, it’s because of provisioning for mark-to-market forex losses).

Operationalising the India-US nuclear deal seems a reality, and the monsoons are showing signs of revival. That’s more than adequate reason for punters on the street to cheer, after months of being mauled by the bear.

The relief of falling crude prices was felt globally, and triggered a rally of sorts. Between 16th and 31st July, the Dow Jones in the US gained 139 points. The Indian markets outsmarted the Dow gaining 1,780 points in that period. After months of furious selling, foreign institutional investors (FIIs) finally turned net buyers—they bought shares worth $15.5 million in the July15-31 period as against sales of $6.62 billion in 2008. The billion dollar question: Is this rally for real, and is it here to stay, sweeping aside worries of still-rising inflation, high interest rates and, consequently lower economic growth?

Back home, clearly the biggest trigger for sentiment revival is the expectation that reforms will get a kick-start. Disinvestment in staterun companies, an increase in foreign direct investment (FDI) in the insurance and media sectors, and doing away with the cap of 10 per cent on voting rights in private sector banks are just some of the proposals that market men expect to be given the go-ahead. “Initially, economic reforms that do not require Parliament approval will be dealt with,” says Manish Sonthalia, Senior Vice President, Research and Strategy (Retail and Private Client Group) at Motilal Oswal Securities. He says one such reform expected is disinvestment of public sector undertakings and the sale of a residual stake in some of the state-run companies.

Macquarie Securities, in a strategy note, adds disinvestment of state enterprises is high on the priority list as it will also help the government stave off some of the fiscal pressures building up.

That the government is in a mood to get on with things was evident last fortnight when it announced that private asset management companies—HSBC AMC, Reliance Capital AMC, and ICICI Prudential AMC, along with SBI AMC —would be allowed to manage employees’ pension funds. “This is the first sign of government going for reforms,” says Nikunj Doshi, Investment Manager with Envision Capital Advisors.

Another sector on the reforms agenda is insurance, where the FDI limit is expected to be raised to 49 per cent from 26. From a stock market perspective there are no directly listed insurance companies, but there are several listed companies that have formed joint ventures with foreign companies. The valuations of such companies, like Bajaj Finserv, IDBI, ICICI Bank, HDFC, and Exide Industries, will doubtless get a fillip if the FDI limit is propped up in insurance.

Running with the bulls
Good news isn't scarce

  • Crude oil prices had fallen to $125.30 per barrel at the time of writing, from a recent all-time high of $148.6

  • Early signs of scanty rainfall have disappeared and the monsoons seem to have revived

  • Promise of reforms like disinvestment of PSUs, and an increase in FDI limits in select sectors

Hunting with the bears
But there are areas of concern

  • Inflation is still high and rising. RBI's target of bringing it below 7 per cent by March 2009 appears challenging

  • Higher interest rates will slow down lending activity, and rein in growth

  • Although oil prices have fallen, $150 per barrel levels can't be ruled out, not yet

Saturday, August 16, 2008

Initial Public Offer

An initial public offering (IPO) is the first sale of a corporation's common shares to public investors. The main purpose of an IPO is to raise capital for the corporation. While IPOs are effective at raising capital, they also impose heavy legal compliance and reporting requirements. The term only refers to the first public issuance of a company's shares; any later public issuance of shares is referred to as a Secondary Market Offering. A shareholder selling its existing (not new) shares to public on the Primary Market is an Offer for Sale.

IPOs generally involve one or more investment banks as "underwriters." The company offering its shares, called the "issuer," enters a contract with a lead underwriter to sell its shares to the public. The underwriter then approaches investors with offers to sell these shares.

The sale of shares in an IPO may take several forms. Common methods include:

  • Dutch auction
  • Firm commitment
  • Best efforts
  • Bought deal
  • Self Distribution of Stock

A large IPO is usually underwritten by a "syndicate" of investment banks led by one or two major investment banks (lead underwriter). Upon selling the shares, the underwriters keep a commission based on a percentage of the value of the shares they sell. Usually, the lead underwriters, i.e. the underwriters selling the largest proportions of the IPO, take the highest commissions—up to 8% in some cases.

Historically, IPOs both globally and in the US have been underpriced. The effect of underpricing an IPO is to generate additional interest in the stock when it first becomes publicly traded. This leads to massive gains for investors who enter the IPO early. However, underpricing an IPO results in "money left on the table," lost capital that could have been raised for the company had the stock been offered at a higher price.

Investment banks therefore take many factors into consideration when pricing an IPO, and attempt to reach an offering price that is low enough to stimulate interest in the stock, but high enough to raise an adequate amount of capital for the company.

Friday, August 15, 2008

Public Issue

Any company or a listed company making a public issue or a rights issue of value of more than Rs 50 lakhs is required to file a draft offer document with SEBI for its observations. The company can proceed further only after getting observations from SEBI. The company has to open its issue within three months from the date of SEBI's observation letter.

Through public issues, SEBI has laid down eligibility norms for entities accessing the primary market. The entry norms are only for companies making a public issue (IPO or FPO) and not for listed company making a rights issue.

The entry norms are as follows Entry Norm I (EN I): The company shall meet the following requirements
  • Net Tangible Assets of at least Rs. 3 crores for 3 full years.
  • Distributable profits in atleast three years.
  • Net worth of at least Rs. 1 crore in three years.
  • If change in name, atleast 50% revenue for preceding 1 year should be from the new activity.
  • The issue size does not exceed 5 times the pre- issue net worth.
SEBI has provided two other alternative routes to company not satisfying any of the above conditions to provide sufficient flexibility and also to ensure that genuine companies do not suffer on account of rigidity of the parameters, for accessing the primary Market. They are as under

Entry Norm II (EN II)
  • Issue shall be through book building route, with at least 50% to be mandatory allotted to the Qualified Institutional Buyers (QIBs).
  • The minimum post-issue face value capital shall be Rs. 10 crore or there shall be a compulsory market-making for at least 2 years.
Entry Norm III (EN III)
  • The "project" is appraised and participated to the extent of 15% by FIs/Scheduled Commercial Banks of which at least 10% comes from the appraiser(s).
  • The minimum post-issue face value capital shall be Rs. 10 crore or there shall be a compulsory market-making for at least 2 years.
    Note :- The company should also satisfy the criteria of having at least 1000 prospective allotees.
The following are exempted from the ENs
  • Private Sector Banks
  • Public sector banks
  • An infrastructure company whose project has been appraised by a PFI or IDFC or IL&FS or a bank which was earlier a PFI and not less than 5% of the project cost is financed by any of these institutions.
  • Rights issue by a listed company

Wednesday, August 13, 2008


In mainstream economics, inflation is a rise in the general level of prices, as measured against some baseline of purchasing power.

The prevailing view in mainstream economics is that inflation is caused by the interaction of the supply of money with output and interest rates. In general, mainstream economists divide into two camps: those who believe that monetary effects dominate all others in setting the rate of inflation, or broadly speaking, monetarists, and those who believe that the interaction of money, interest and output dominate over other effects, or broadly speaking Keynesians.

Related terms include: deflation, a general falling level of prices, disinflation, the reduction of the rate of inflation, hyper-inflation, an out of control inflationary spiral, and reflation, which is an attempt to raise prices to counter act deflationary pressures.

Measures of Inflation
Measuring inflation is a question of econometrics, that is, finding objective ways of comparing nominal prices to real activity. In many places in economics, "real" variables need to be compared, in order to calculate GDP, effective interest rate and improvements in productivity. Each inflationary measure takes a "basket" of good and services, then the prices of the items in the basket are compared to a previous time, then adjustments are made for the changes in the goods in the basket itself. For example if a month ago canned corn was sold in 10 oz. jars, and this month it is sold in 9.5 oz jars, then the prices of the two cans have to be adjusted for the contents. The result is the amount of increase in price which is attributed to "inflation" and not to improvements in productivity.

The role of inflation in the economy
In the long run, inflation is generally believed to be a monetary phenomenon, while in the short and medium term, it is influenced by the relative elasticity of wages, prices and interest rates. [1] The question of whether the short-term effects last long enough to be important is the central topic of debate between monetarist and Keynesian schools. In monetarism, prices and wages adjust quickly enough to make other factors merely marginal behavior on a general trendline. In the Keynesian view, prices and wages adjust at different rates, and these differences have enough effects on real output to be "long term" in the view of people in an economy.

Mutual Funds Structure

Mutual Funds

Mutual Fund is a means for pooling the resourced and investing funds in securities in accordance with the objectives of the scheme.

They operate as Collective Investment Vehicles that pool resources by issuing units to investors and collectively invests those resources in a diversified portfolio comprising of stocks, bonds or money market instruments in accordance with the objectives disclosed in the offer document issued for purpose of pooling resources. The profits or losses are shared by the investors in proportion to their investments.

Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. The flow chart below describes broadly the working of a mutual fund.

Fig. 1: Mutual fund operation flow chart.

A Mutual Fund can fit well into the long or short term strategy of an investor. However the success of the plan depends upon the type of fund chosen. As all the funds invest in securities market, it is crucial to maintain realistic expectations about the performance of the markets and choose the funds accordingly, which best suits the investor’s needs.

Fig. 2 Structure of Mutual Funds

Mutual Fund Structure
A mutual fund is set up in the form of a trust, which has sponsor, trustees and an asset management company (AMC).


Sponsor is the person who acting alone or in combination with another corporate body establishes a mutual fund. He acts like a promoter of a company. Sponsor must contribute at least 40% of the net worth of the Investment Managed and meet the eligibility criteria prescribed under the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996. The sponsor is not responsible or liable for any loss or shortfall resulting from the operation of the schemes beyond the initial contribution made by it towards setting up of the Mutual Fund.


The Mutual Fund is constituted as a trust in accordance with the provisions of the Indian Trusts Act, 1882 by the sponsor. The trust deed us registered under the Indian Registration Act, 1908. The trust is established by a sponsor, who acts like a promoter of a company.


Trustee is usually a corporate body or a board of Trustees. The main responsibility of the Trustee is to safeguard the interest of the unit holders and ensure that the AMC functions in the interest of investors and in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996.

At least 2/3rd directors of the Trustee are independent directors who are not associated with the Sponsor in any manner.

Asset Management Company (AMC)

The AMC is appointed by the Trustee as the Investment Manager of the Mutual Fund. It manages the funds by making investments in various types of securities. AMC floats and manages different investment ‘Schemes’ as per SEBI regulations. At least 50% of the directors of the AMC are independent directors who are not associated with the Sponsor in any manner. The AMC must have a net worth of at least Rs 10 Crore at all times.

Apart from these, MF also has some other fund constituents, such as custodians and depositories, banks, transfer agents and distributors.

Custodians: Is approved for the safe keeping of securities and participating in the clearing system through approved depository.

Bankers handle financial dealings of the fund.

Transfer Agents are responsible for issue and redemption of units of MF.

Fig. 3 benefits of Mutual Funds..


Tuesday, August 12, 2008

Mutual Funds

Mutual Funds are one of the most preferred investment tools. They have always found preference over individual stocks because of the many advantages they provide.

Over the years, MFs have graduated into a flexible and innovative avenue for investors. For individual investors, with neither a lot of money to invest, nor the time devote track the market movements, mutual funds offer great advantage that simply aren’t available elsewhere. Instead of picking stocks and bonds one at a time, Mutual Funds offer the investors an opportunity to invest in a ‘collection of stocks’, designed to meet their investment objectives.

In a country like India, where the majority of investors are conservative and risk averse, mutual funds come across as an attractive investment avenue, which promises the investors good returns and at low risks.

Mutual Funds make investing easier but they do not necessarily make it easy. It is important for the investor to keep track of their investments. And all the more considering the current market volatility, it’s essential for an investor to make guided and rational decisions on whether he gets an acceptable return on his investments in the funds selected by him, or if he needs to switch to another fund.

In order to achieve such an end the investor has to understand the basis of appropriate preference measurement for the fund, and acquire the basic knowledge of the different measures of evaluating the performance of the fund. Only then he would be in a position to judge correctly whether his fund is performing well or not, and make the correct decision.

The project therefore attempts to analyse mutual funds more effectively by measuring their risk- return ratios with the help of technical tools namely – Sharpe Ratio, Treynor Ratio, Jensen’s Alpha, M2, Sortino Ratio, Information Ratio, Standard Deviation, Coefficient of Determination (R2) and Beta.


This website is NOT affiliated to any of listed company. We will not be liable for any damages/losses relating to your use of the information provided herein. Past performance of a trading system or market is not necessarily indicative of the future performance of the same system or market.
NO copyright infringement is intended. Please feel free to contact us on vinodgupta85[at]gmail[dot]com, in case you feel that some images or stories displayed are in violation of copyright or any law.